SPECIAL REPORT: OOIDA files class action against North American Van Lines

| Friday, March 25, 2005

The Owner-Operator Independent Drivers Association and six of its owner-operator members have filed a class action against North American Van Lines in federal court in Roanoke, VA. The complaint was filed on behalf of all owner-operators moving freight under North American's federal operating authority. The lawsuit seeks injunctive relief and damages for wide ranging violations of the federal truth-in-leasing regulations.

The complaint challenges North American's business practices toward its independent drivers. At the most fundamental level, federal law requires that the relationship between the carrier and driver must be governed by a written agreement. The suit alleges that hundreds of owner-operators have driven for North American for many years with no written agreement.

The complaint alleges that North American unlawfully reduces the revenue base from shipments on which owner-operator compensation is calculated, and that North American does not provide drivers with required information and documentation that would allow them to check the accuracy of amounts paid to them for their services.

North American, like most motor carriers, reports state fuel use taxes on a fleet-wide basis. Drivers pay the fuel tax at the pump, and receive credits for amounts overpaid in various states. The complaint alleges that North American confiscates driver credits if the credit is not offset within 30 days, which is in violation of the escrow provisions of the federal leasing regulations.

The complaint states that North American requires drivers to contribute to a fund that North American uses to pay its public liability insurance and to cover the cost of certain government required safety and compliance programs. The plaintiffs contend that federal law places the obligation for those payments solely on the motor carrier, and that passing through or charging back the cost of them to drivers is improper. It is further alleged that unused funds are forfeited to North American, violating the requirement that such money be returned to drivers.

Lastly, the complaint alleges that owner-operators are forced to purchase certain products and services from the Fort Wayne, IN-based carrier as a condition of receiving freight assignments. The suit states that drivers must purchase through North American public liability and property damage insurance, full valuation cargo insurance, credit card services and Qualcomm communications equipment. The forced purchase of products and services is prohibited under the federal truth-in-leasing regulations.